A new investigation just made Tesco's crisis even worse
REUTERS/Toby Melville
Christine Tacon, the groceries code adjudicator (GCA), launched the probe after considering information related to a massive accounting scandal.
Last September, Tesco announced that it overstated profits in the first half of the year by more than £250 million ($403 million). Tesco's accounts between 2012 and 2014 are currently under investigation by the Financial Reporting Council.
The GCA investigation, expected to take place over the next 6-9 months, will consider practises associated with delays in payments, including short deliveries, consumer complaints where the amounts were not agreed, invoicing discrepancies, and deductions for un-agreed items.
"I have applied the GCA published prioritisation principles to each of the practises under consideration and have evidence that they were not isolated incidents, each involving a number of suppliers and significant sums of money," Tacon said in a statement.
Tacon "has discussed the practises with Tesco and now needs more information from direct suppliers and others to determine what further action to take."
The investigation is the latest in a string of troubles for Britain's biggest supermarket, which is facing increasing competition from discount retailers like Aldi and Lidl. JPMorgan issued a damaging note against the retailer in December. In January, the supermarket announced it was closing 43 stores in the UK to cut costs.
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